Hyundai Motor Group Ranks 2nd in the World for Operating Profit in the First Half of the Year, Surpassing VW for the First Time

In the first half of 2025, Hyundai Motor Group (Hyundai + Kia) achieved a historic ranking in the global "profit rankings." It surpassed Volkswagen (VW) in operating profit, reaching second place in the world, just behind the Toyota Group. They managed to overcome challenges such as the slowdown in EVs and U.S. tariffs through agile inventory and production management and a profit-focused product lineup. Korea Joongang Daily

Reading the "Reversal" by Numbers

According to industry data, Hyundai and Kia's consolidated operating profit for the first half was 13.01 trillion won. In contrast, VW's was 6.6 billion euros (approximately 10.86 trillion won), marking the first time Hyundai has surpassed VW on a half-year basis. The top spot is still held by the Toyota Group. In terms of profit margin, Hyundai was reported at 8.7%, following Toyota's 9.2% and surpassing VW's 4.2%. This suggests a broad enhancement of their profit structure, rather than a mere "lucky win." Korea Joongang DailyChosun Biz

Reasons for Hyundai's Victory: Speed and Choices

The factors supporting this leap were: ① agile management of inventory and production anticipating the U.S. tariff shock, ② persistent sales in the North American and Korean base markets, and ③ a product mix shift towards "sellable electrified vehicles" centered on hybrids (HEVs). Hyundai reported record-high sales in the second quarter, although operating profit declined. This means that even in a tough environment where "sales are up but profits are down," they secured enough profit to surpass major competitors in the first half. The company explained that sales of electrified models increased by 36.4% year-on-year, suggesting that faster-moving HEVs likely acted as a stabilizer in their portfolio. hyundai.com

Persistent Risks: The Shadow of Tariffs

Of course, it's not all rosy. Hyundai mentioned that their second-quarter operating profit decreased due to tariff impacts and referred to the "risk of further deterioration in the near term." U.S. auto and parts tariffs are driving up supply chain costs, forcing a "dilemma" between price increases and profit pressure. Local reports also point out that the profitability of Korean parts suppliers is low, making it easier for the burden to concentrate on lower tiers. For the group as a whole, accelerating localization of North American production and revising pricing and promotional strategies are essential. ReutersKorea Joongang Daily

VW's Slowdown Also a Factor in the Reversal

This "reversal drama" is not solely due to Hyundai's efforts. VW's operating profit in the first half of 2025 fell by about 33% year-on-year, remaining at 6.6 billion euros. Intensified competition in China, tariff costs, and the burden of model transitions are weighing heavily. It's a typical example where market share size does not necessarily translate to profit size, questioning the "lightness" of corporate structure and capital efficiency. Yahoo Finance

Capturing Social Media Reactions: Tweets of Praise and Concern Intersect

The news spread across various media X (formerly Twitter) accounts. In addition to distribution via Korean media, India's economic media ZeeBiz also reported it as breaking news. Observing the timeline, it converges into mainly three patterns.

• "Finally surpassed VW. The winning strategy for HEVs is visible" (praise and strategic evaluation)

• "But won't tariffs make it tough from the third quarter onward?" (caution about the future)

• "Even if profits are second, VW still leads in sales volume, right?" (calm comparison)

Specifically, posts from Yonhap News and ZeeBiz became the "sources of spread" for the breaking news, prompting many quotes and reposts. Comments from investor accounts noted, "An over 8% profit margin is commendable, but it depends on U.S. policy," while fan accounts suggested, "The recognition penetration of Ioniq/EV6 was effective." Both celebratory mood and practical concerns are progressing simultaneously in the current atmosphere. X (formerly Twitter)

Short-term Focus: Three Checklists

1. Pricing and Incentives: How much of the tariff can be passed on to prices? Strengthening promotions may protect market share but can easily erode profit margins.

2. Speed of Localization: How much can the localization of North American production and procurement avoid the cost typhoon?

3. Product Mix: The depth of HEVs and the recovery timing of EVs, especially in Europe. Hyundai has shown "sellable electrification," but adjustments will continue amid accelerating regulations and competition.

Mid-to-Long-Term Outlook: Conditions for a Winner

This rise to second place is not only a "tactical victory" but also a testament to corporate strength. Whether they can sustain profits second only to Toyota depends on three points: (1) containing tariff risks in North America, (2) maximizing investment efficiency during the electrification transition, and (3) addressing price competition in China and Europe. VW's struggles indicate that the era has shifted from valuing sales scale to questioning "how efficiently can you earn." Hyundai is indeed moving forward with this "new yardstick." Yahoo Finance